Morning News: April 3, 2026
Posted by Eddy Elfenbein on April 3rd, 2026 at 7:02 am

Take Hormuz by Force? France and Britain Have Better Ideas

Macron Criticizes Trump and Calls on Allies to Unite Against US

Rival Nations Seize On Choke Points to Counter Trump

Tanker Carrying Iranian Crude Shifts Course from India to China

Iran Strikes Gulf Energy Sites as Trump Warns of Further Attacks

Bombing Iran’s Great Mosque Could Cost the World

Israel Resumes Biggest Gas Field After War Shut It for a Month

Fed’s Logan Says US Oil Producers Unlikely to Provide Near-Term Relief for Consumers

Jefferies Says UAE Injected $8 Billion Liquidity to Help Lenders

How Insulated Is the U.S. Economy From the Iran War?

Trump Budget Pits Spending Cuts Against Massive Defense Push

Blue Owl Reels as Investors Who Fueled Its Growth Now Want Out

401(k) Investment Menus Need a Reboot

Tariffs Strained U.S. Aluminum Supplies. Now the Iran War Is Making It Worse

U.S. Steel Tariffs Hurt America, Help China

A Bottle of Wine Shows the Slow-Motion Impact of Trump’s Tariffs

Trump Administration Unveils Up to 100% Tariff on Branded Drugs

JetBlue Raises Checked Bag Fees as Fuel Costs Soar

Amazon to Apply 3.5% Fuel Surcharge to Third-Party Sellers

The Era of AI FOMO Is Upon Us

Economists Once Dismissed the A.I. Job Threat, but Not Anymore

Jobs and Workers Are in Balance. Nobody Is Happy About It.

Skilled Foreign Workers Think About Leaving the U.S.

Bondi’s Firing Is Actually Good News

Trump’s Media-Bashing Is Coming Back to Bite Him in Court

SpaceX Targets More Than $2 Trillion Valuation in IPO

It’s Not Easy Being a Trillionaire

Under the Skin of America’s Humanoid Robots: Chinese Technology

Google/Meta Verdict: A Whole Lot of Nothing to Feed the Perpetually Alarmed

Google Workers Find It’s a Different Era for Activism

A Nintendo Cinematic Universe Can Learn From Marvel

Will Nike CEO’s Candor With Staff Have Any Effect on Performance?

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Morning News: April 2, 2026
Posted by Eddy Elfenbein on April 2nd, 2026 at 7:05 am

Iran War Showcases Strength of South Korean Defense Sector

Macron Says Trump Weakens NATO by Casting Doubt on US Commitment

Trump Stirs Market, Political Angst With Vague Timeline for Iran

Defeat Has Never Sounded as Victorious as in Trump’s Address

U.S. Lifts Sanctions on Venezuela’s Leader, Opening Door to Deals

Tracking Trump’s Tariffs Across the Global Economy

How to Get a Tariff Refund

Tariff-Struck Companies Exploring Loans Backed by Refund Claims

How Swap Markets Are Struggling to Gauge Rates as Iran War Fuels Volatility

Hedge Funds Walloped by a Month of Turmoil Sparked by Iran War

Mark Meador and the FTC Scarily Revive Teddy Roosevelt Economics

There’s a Competition Crisis, Not An Affordability Crisis

Institutional Investors Are Asking To Do Your Worrying For You

KKR Secures $23 Billion for Americas PE in Its Largest-Ever Haul

Antisemitic Violence Sparks $765 Million in Security Spending

Nursing Is the Surefire New Path to American Prosperity

140 Million Americans Are Locked Out of Low-Cost Access to Healthcare

How A.I. Helped One Man (and His Brother) Build a $1.8 Billion Company

SpaceX Files to Go Public, Setting Stage for Huge I.P.O.

A $45,000 Porsche Taycan Is a Decent Oil Price Hedge

G.M. Reports Sharp Decline in Car Sales Amid War and High Prices

Foreign CEOs Face More Scrutiny. Air Canada’s Earned It

US Job-Cut Announcements in Tech Keep Rising With AI Adoption

Microsoft CFO’s AI Spending Runs Up Against Tech Bubble Fears

Europe Pushes for a Gentler Internet for Children

Goodbye ‘Geeky Hunk’? Gmail Users Can Now Change Their Usernames

Louis Vuitton, Gucci, Prada … Meta?

TotalEnergies, Masdar Form $2.2 Billion Asia Renewables Joint Venture

State Farm Is in Trump’s Crosshairs Over L.A. Fires

How a Sapling and a Viral Candy Made California the World’s Pistachio King

The IRS Chief, His Old Pal and the Case of Muhammad Ali’s Missing Pair of Shorts

The Women Who Love the Manosphere

Six Flags Was a Summer Destination. Can It Win Families Back?

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Morning News: April 1, 2026
Posted by Eddy Elfenbein on April 1st, 2026 at 7:01 am

Global Ban on Digital Duties Expires After Stalled Talks at W.T.O. Meeting

Iran War Hobbles Myanmar Economy as Gasoline Supplies Disappear

Some French Gas Stations Run Dry as Price Caps Spur Rush to Fill

Ukraine Is Having a Surprisingly Good Iran War

The Dubai War Narrative Is Looking a Little Stretched

Four Passover Questions as the Iran War Nears Endgame

Stocks in Asia Rally and Oil Prices Rise

Bank of England Says Iran War Has Boosted Threats to Financial Stability

Dimon Says Vital US Ensures Iran War Is ‘Successfully Completed’

Indian Rupee Set for More Chaos as Banks Unwind $30 Billion in Arbitrage Trades

The Economy Is on the Edge. What Could Tip It Over, or Help It Pull Through.

Prediction Markets Are An Essential Driver of Better Decisions

Bearish Positioning Is Driving Stocks More Than Peace Prospects

Wells Fargo Unleashes Pent-Up Power in Crucial Repo Market

Is U.S. Housing Starting to Crash?

Institutional Investors Are the Housing Solution, Not the Problem

Trump’s Executive Order on NPR and PBS Is Unconstitutional, Judge Rules

The Year Is Off to the Strongest Start for Big Deals Ever

Global First-Quarter M&A Exceeds $1.2 Trillion, Led By AI

The 322-Foot Tall Rocket for NASA’s Moon Flyby

America Now Has an EV Rust Belt. High Gas Prices Won’t Rescue It.

Anthropic Accidentally Posts Source Code of Claude AI Agent

Oracle Lays Off Workers Amid Heavy AI Investment

Google Faces Demands to Prohibit AI Videos for Kids on YouTube

Big Drug Companies Hunting for Deals Are Lowering Their Sights

Nike Guides for Sales Declines Ahead as Turnaround Plan Hits Snags

Allbirds, Once Silicon Valley’s Favorite Shoe, Sells for $39 Million

Ken Paxton Should Know That Government Can’t Lower Ticket Prices

Las Vegas Is Still a March Madness Mecca

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CWS Market Review – March 31, 2026
Posted by Eddy Elfenbein on March 31st, 2026 at 7:05 pm

(This is the free version of CWS Market Review. If you like what you see, then please sign up for the premium newsletter for $20 per month or $200 for the whole year. If you sign up today, you can see our two reports, “Your Handy Guide to Stock Orders” and “How Not to Get Screwed on Your Mortgage.”)

The first quarter came to an end today, and it was a difficult one for Wall Street. We started off the quarter, and the new year, just fine. By January 27, the S&P 500 reached an all-time closing high. Then on February 6, the Dow Jones Industrial Average closed above 50,000 for the first time ever.

Then in the middle of the quarter, things started to change as the market had to deal with the ramifications of military operations in the Middle East. The Strait of Hormuz was shut down and the price of oil shot to more than $100 per barrel. It’s still up there as I write this.

Now the damage is being felt on Wall Street and on Main Street. The price for a gallon of gas is now above $4. In recent days, the Dow closed more than 10% off its high which is the traditional definition of a market correction.

Here’s how the three major indices performed during Q1:

S&P 500: -4.63%

Dow Jones Industrial Average: -3.58%

Nasdaq Composite: -7.11%

The S&P 500 closed Monday at 6,343.72 which marked its lowest close since August 7, 2025. The index is currently below its 50- and 200-day moving averages. It’s not in correction territory yet, but it’s getting close.

March turned out to be the worst month for stocks in more than a year, and Q1 was the worst quarter for the S&P 500 in nearly four years. If we measure from the market’s high in February 2025, then the stock market has barely advanced — and adjusted for inflation, the market is basically flat for 13 months.

The Mag 7 stocks, in particular, have not fared well. All seven lost ground during Q1:

Google is missing from the chart because I’m only allowed six lines at once. For the quarter, Google lost 8.06%.

The stock market had a big relief rally on Tuesday (+2.91%). I tend to be skeptical of outsized “contra-trend” rallies. This is when the stock market does exactly the opposite of what it had been doing, and it does it by a lot. Don’t get me wrong. I’ll welcome any rally, but days like today seem more like temper tantrums rather than optimistic rallies.

The stock market rallied after the president of Iran said that his government might be open to ending the war. The Dow rallied over 1,100 points today and the Nasdaq was up 3.83%.

Earlier today, the Labor Department’s JOLTS report said that hiring in February fell to its lowest level in six years. This week, we’re going to learn a lot more about how well the economy is performing. Tomorrow, ADP will release its monthly report on private payrolls. Wall Street expects to see a gain of 39,000 jobs.

We’ll also get the retail sales report for February. If you recall, the report for January was not terribly good. For tomorrow, Wall Street expects to see a gain of 0.5%, and a gain of 0.3% excluding autos. At 10 a.m. ET tomorrow, we’ll get the ISM Manufacturing Index.

That leads us to Friday and the big March jobs report. This report will be a little unusual in that the stock market will be closed on Friday for Good Friday. This means that we’ll have to wait until Monday to see the market’s reaction.

For Friday’s report, Wall Street expects to see a gain of 59,000 jobs. For February, the economy lost 92,000 jobs. Analysts also see the jobless rate staying at 4.4%. Hourly average earnings are expected to rise by 0.3%. That’s not bad, but I hope to see better numbers.

This leaves the Federal Reserve in a difficult position. The jobs market is weak, and commodity prices are rising. The economy would certainly benefit from lower prices, but the inflation may be too precarious to ignore.

The Fed meets again in four weeks, and it will be Jerome Powell’s final meeting as Fed Chair. Now it looks like the Fed may not touch interest rates before the end of this year. In fact, they may not make any changes to rates for another 16 months. That’s according to the latest futures prices.

Stryker Hits New 52-Week Low

I wanted to highlight Stryker (SYK) this week. The stock has been on our Buy List for the last 19 years in a row. It’s a wonderful company, and I’m glad we’ve owned it.

Lately, however, the shares haven’t performed very well. The company was also the victim of a nasty cyber-attack. Fortunately, most of its systems are back up and running. Today, shares of Stryker got down to a new 52-week low. The stock is back to where it was nearly two years ago.

Here’s a look at 40 years of SYK:

It’s hard to find a point when it wasn’t a good time to buy Stryker. This is also a good example of Elfenbein’s Law: “When a stock has done so well that the legend for the vertical axis is unreadable, that’s probably a good sign.”

In January, Stryker reported very good numbers for Q4. Earnings rose 11.5% to $4.47 per share. That was eight cents better than expectations. Stryker’s own guidance had been for $4.34 to $4.44 per share.

Net sales were up 11.4% to $7.2 billion, and organic sales were up 11.0%. Stryker’s operating margin increased 100 basis points to 30.2%. For the year, Stryker made $13.63 per share. That’s up 11.8% over last year.

Here’s a look at Stryker’s annual earnings:

For 2026, Stryker expects earnings between $14.90 and $15.10 per share, and organic-net-sales growth of 8.0% to 9.5%. If that’s correct, then it would be another good year for SYK.

That’s all for now. The stock market will be closed on Friday in honor of Good Friday. I’ll have more for you in the next issue of CWS Market Review.

– Eddy

Morning News: March 31, 2026
Posted by Eddy Elfenbein on March 31st, 2026 at 7:08 am

War’s First Inflation Hit Arrives in the Euro Area

China’s Pivot to Vietnam Blows Hole in Trump’s Made-in-USA Plan

Why Is the Japanese Yen So Weak — and Will Authorities Intervene?

A $50 Trillion National Debt In 2030 Will Signal Opposite of Debt Problem

US Bonds Are Caught in a Tug-of-War Between Inflation and Growth

Who Is Laffing Now?

Powell Says Fed Can Look Past Oil Shock, but Warns Patience Has Limits

Oil and Gas Prices Continue to Rise in Choppy Trade

Energy Stocks Set to Beat Broader Market by Biggest Margin Ever

Fresh Food Distributors Add Surcharges as Fuel Costs Rise

Trump Tax Law’s Expansion of Affordable Housing Credit Hits Snag

Government Attacks on Credit Cards Won’t Bring Down Prices

Private Lenders Delay Reckoning with Payment Concessions on Stressed Debt

U.S. Banks Raising Borrowing Costs for Private Credit Funds as AI Fears Pummel Valuations

JPMorgan Takes On American Dream in Latest Firmwide Initiative

Private Equity’s Growing Appetite for Fast Food in Japan

Japan Is Placing a Multibillion-Dollar Bet on the US Housing Market

Lilly to Buy Sleep Drug Maker Centessa in $7.8 Billion Deal

Biogen to Buy Apellis for $5.6 Billion to Boost Kidney Franchise

Unilever Food Arm to Join With McCormick in $44.8 Billion Deal

Unilever’s $40 Billion Food Sale Augurs a More Beautiful Future

Whoop Raises $575 Million at a $10 Billion Valuation on Its Way to an IPO

Google Partner Tenex Raises $250 Million for AI Security Services

The Sudden Fall of OpenAI’s Most Hyped Product Since ChatGPT

Exxon Scientists Had Doubts About Algae Biofuels. The Oil Giant Touted Them Anyway.

Delta to Tap Amazon Satellite-Internet Service for In-Flight Wi-Fi

Hegseth’s Culture Wars Are Inviting a Military Disaster

A Crackdown on Dreamers Is a Crackdown on the American Dream

The DC Streetcar Was Desired. It Just Wasn’t Worth It

How a Massive KitKat Heist Turned Into Crisis PR Gold

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Morning News: March 30, 2026
Posted by Eddy Elfenbein on March 30th, 2026 at 7:05 am

Trump Claims Iran Gave In to US Demands, Considers Seizing Oil

Oil Jumps on Signs of Escalation of Middle East War

The Oil Market Is Moving Into Demand Destruction Mode

The Strait of Hormuz Oil Shock Is Now Heading West

Oil Shipping Rates Surge as US Barrels Replace Middle East Supply

Why the Iran War May Force Countries to Rely Less on Natural Gas

This Is What Happens When the Gas Runs Out

Indian Economy Faces Risks on Multiple Fronts From Middle East Conflict

Japan Steps Up Yen Warnings as Mideast War Stokes Inflation Concerns

Eurozone Business Confidence Falls on Iran War

Government Bonds Rally Around the World on Slowdown Concerns

Fed Officials Signal That Rate Cuts May Be Over

Two Data Points to Consider a Year Since Trump’s Tariff Liberation Day

Swiss Cling on to Cash as Survey Shows Payment App Use Stalling

BBVA to Sell Romania Business to Raiffeisen for $680 Million

A 35-Year-Old Crypto Bro Helped Pakistan Win Over Trump World

Is Another Financial Crisis Lurking in Private Credit?

Private Equity’s Brutal Side Deals Leave Lenders Grasping in the Dark

Private-Credit Wobbles Could Prove Perilous for Trump

Three Reasons the Stock Market Can Endure the War

Too Bad the Robinhood Crowd Isn’t Buying This Dip

Why the Cost of Your Coffee Has Soared—and Isn’t Going Down Soon

$100,000 in Social Security Benefits Is Too Much

How Working in America Became So Joyless

Chromebook Remorse: Tech Backlash at Schools Extends Beyond Phones

Teens Sick of Their iPhones Are ‘Mallmaxxing’

How the Federal Government Turned Intel Into a Puppet

Nvidia Is Credit Personified While the Fed Is a Pointless Distraction

Inside the Odd—and Oddly Human—Work of Teaching AI to Talk

Why Corporate AI Mandates Don’t Work

LaGuardia Crash Bolsters Case for Using AI in Air Control Towers

BYD Posts First Annual Profit Decline in Four Years

Ford and GM Increase Destination Charges to $2,795 on Full-Size Trucks

World War III’s First Shots Will Be Fired in Space

Food Megamergers Hardly Ever Work. Could McCormick-Unilever Be Different?

Sysco to Buy Restaurant Depot in $29 Billion Deal

WNBA Players Had an Ace Up Their Sleeve in Pay Negotiations: A Nobel Laureate

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Morning News: March 27, 2026
Posted by Eddy Elfenbein on March 27th, 2026 at 7:03 am

Ukraine Is Running Out of Cash to Pay for the War as Aid Falters

Russians’ Trust in Putin Hits Wartime Low as Fatigue Grows

The Pentagon Needs to Give Better Answers on Its ‘Golden Dome’

The Iran War Is Now All About the Future of Hormuz

China Hits Back at U.S. With New Trade Probes Ahead of Trump-Xi Summit

Riyadh, Dubai Delay Finance Events as Iran War Disrupts Region

Iran War Threatens to Reverse Central Banks’ Role as Major Gold Buyers

How the Iran War Is Costing the Economy Its Buffers

Fertilizer Maker Yara Warns Farmers Are Being Squeezed by Price Surge Amid War

Resurgent Inflation Tests Faith in Fed’s Willingness to Tame It

Economists See War Pushing US Inflation Above 3%, Hurting Growth

Oaktree to Meet 8.5% Private Credit Fund Redemptions in Full

Homophones, Plurals and Language ‘Rulescucks’ Are Roiling Prediction Markets

He Did Not Intend to Lose $50 Million. No One Does

Health-Care Costs Are Forcing Terrible Trade-Offs

The Startup Selling Full-Body Scans as the Future of Health Care

Why College Graduates Feel Betrayed

Tracking Trump’s Efforts to Reshape Cultural Institutions

Inside the Sprawling World of MAGA Merchandise

Crypto for a Home? Coinbase Brings Token-Backed Down Payments to Housing Market

CrossCountry Mortgage to Acquire Two Harbors

An Invisible Bottleneck: A Helium Shortage Threatens the Chip Industry

Is Big Tech Facing a Big Tobacco Moment?

SoftBank Secures Record $40 Billion Bridge Loan for OpenAI Stake

Export Controls Risk Forfeiting the AI Race

An AI Upheaval Is Coming for Media. This Journalist Is Already All In.

Pernod Ricard Shares Pare Losses as Investors Warm to Mooted Brown-Forman Tie-Up

Why Kraft Heinz’s CEO Decided Not to Split the Company in Two

That McDonald’s Viral Video Is Good for Memes. But Sales?

Why Are Theater Tickets So Much Cheaper in London Than New York?

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Morning News: March 26, 2026
Posted by Eddy Elfenbein on March 26th, 2026 at 7:04 am

Oil Prices Go Higher and Global Stocks Fall

How Kharg Island May Change the Trajectory of the Iran War

Trump Says the Energy Shock Will Be Short-Lived. CEOs Paint a Scarier Picture

War Hits Global Economy With OECD Seeing 4.2% US Inflation

Asia Is Getting Crushed Between Oil Prices and the Dollar

How Japan Can Use the Oil Market to Support the Yen

A Saudi Six Flags. A Wynn Casino. Gulf Megaprojects Caught in the Iran Conflict.

The Oil Price Shock Could Make Italian Ice More Expensive

Finance Isn’t Prepared for an Iran Crisis. It Should Be

The Problems With Victor Davis Hanson and Economics

EU Lawmakers Approve US Trade Deal After Several Delays

Holders of Russian Debt Gain Easier Path to Payment at Euroclear

Iran War’s Impact on European Financial System ‘Contained’ for Now, ECB’s De Guindos Says

Federal Reserve Posted Loss of $18.7 Billion in 2025

Wall Street Bonus Pool Jumps to a Record $49.2 Billion for 2025

How the Trump Administration Is Testing Fed Independence on Bank Rules

Apollo, Blue Owl Lament Private Credit’s Liquidity Confusion

Private Credit Has an AI Recovery Problem

Investors Switch to Cash From Stocks and Bonds Like It’s 2022

Passive Index Investing and Large Shareholders’ Pursuit of Political Goals

Corebridge Financial, Equitable Holdings to Merge

JPMorgan’s Jamie Dimon Says Remote Work Breeds ‘Rope-a-Dope Politics’ and Stunts Young Workers’ Growth

They Gave Her Business a Lifeline, Then Froze All Her Money

Dominican Republic Is Next Frontier in US-China Space Race

As ChatGPT and Claude Replace Quants, How Can We Unleash AI Capital Markets Era?

Meta and YouTube Found Negligent in Social-Media Addiction Trial

Meta and Google’s Addiction Verdict Turns the Social Media Tide

Meta, Google Risk Big Tobacco-Like Fallout After Addiction Trial

Snapchat Investigated in Europe Over Child Safety Policies

KKR to Make 15 Times Its Investment With Sale of Data-Center Cooling Business

Losses Pile Up for Beef Slaughterhouse Owners

A Film Studio Moved to Montana for Tax Breaks. Will It Benefit the Locals?

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Morning News: March 25, 2026
Posted by Eddy Elfenbein on March 25th, 2026 at 7:05 am

The Choking of Hormuz

The Oil Supply Crunch Is Spreading From the Gulf to the Rest of the World

In Iran War, Cheap Drones Remain Wild Card

Defense Spending, and the 5% of GDP Fallacy

What Happened After a U.S. Warship Hit an Iranian Mine in 1988

The ‘Don Tzu’ Solution to Ending the Iran War

Oil Theft Is Burning a Billion-Dollar Hole in the West Texas Economy

Gas, Not Oil, Is Where US Energy Dominance Matters

Why Are We Clinging To a Law That Makes Gasoline More Expensive?

What Soaring Fuel Costs Mean for Your Air Travel

The US Needs More Air Traffic Controllers. Is It Safe to Fly?

The Lines, the Prices, the Anxiety: Can Air Travel Get Any Worse?

There’s One Clear Winner From the Long TSA Wait Times at Airports

Will Trump (and Russ Vought) Protect Your Financial Data?

In Washington’s War on Data, the Economy and Public Will Lose

Argentina’s 50-Year-Old Coup Still Resonates

How a Dirty Money Trail From Venezuela to Iran Brought Down a Swiss Bank

Gold Has Been a Terrible Iran War Hedge — Why?

A Coach, Mechanic or Housekeeper, but for Your Finances

US Mortgage Rates Jump Further to Five-Month High of 6.43%

Tricolor Implosion Pits Wall Street Against Immigrant Car Buyers

ICE Has Left Minneapolis. The Economic Hangover Hasn’t.

The Death Spiral of a $250 Million Satellite Startup

How Selling to a Repressive Regime Almost Broke a Tech Firm

How the Iran War Could Split the AI Boom in Two

Adani Eyes Partnerships With Meta, Google Amid Data Center Boom

Meta Targets $9 Trillion Valuation With New Executive Incentive Program

CoreWeave Shares Lag Rival Nebius in Wild Year Since IPO

Merck to Acquire Terns Pharmaceuticals in $6.7 Billion Deal

Disney CEO’s First Week Marred by ‘Fortnite,’ OpenAI Woes

The Company Where Driving the Wrong Car to Work Can Get You a Ticket

Chewy Posts Higher Profit, Revenue

Labubu Maker’s Earnings Show It’s Not Toying Around, But Investors Aren’t Amused

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CWS Market Review – March 24, 2026
Posted by Eddy Elfenbein on March 24th, 2026 at 5:34 pm

(This is the free version of CWS Market Review. If you like what you see, then please sign up for the premium newsletter for $20 per month or $200 for the whole year. If you sign up today, you can see our two reports, “Your Handy Guide to Stock Orders” and “How Not to Get Screwed on Your Mortgage.”)

I recently came across a stunning fact in the Wall Street Journal. It said that over the last two years, the healthcare sector has accounted for 77% of all jobs growth.

That’s one of those facts that initially strikes you as amazing, but the more you think about it, the more it makes sense. As the rest of the economy gets weaker, the healthcare sector is doing most of the heavy lifting.

Check out the growth of healthcare jobs:

The WSJ notes that over the last year, the U.S. economy has added 156,000 new jobs and healthcare was responsible for 375,000 new jobs. That means that if we take away the healthcare sector, then the economy is shedding jobs. If you’re not at the doctor’s office, then you’re probably in a recession.

Don’t expect these trends to let up anytime soon. According to the WSJ, by 2035, the number of Americans over the age of 85 is expected to double. Now let’s look at what’s had the market so annoyed recently.

The Fed’s Next Move May Be a Rate Hike

The stock market is starting to show some cracks. During the day on Friday, the S&P 500 fell to its lowest point in six months. We got a minor relief rally on Monday, but Tuesday was another down day. The S&P 500 has closed lower eight times in the last eleven sessions. The index is below its 50- and 200-day moving averages. Historically, that’s not a good sign.

There’s even talk of the Fed’s next move being an interest rate hike. To be sure, that possibility is still a long way from being a certainty, but the futures traders peg the odds of a Fed hike before the end of the year at around 20%. The odds of an upcoming interest rate cut are…well, in the garbage can. In a very short period of time, the odds of a Fed cut went from probable to not happening.

If you ever want to know what the Fed is thinking, the cheap and easy way is to look at the yield on the two-year Treasury. On February 28, the two-year yield was at 3.38%. By March 20, it got to 3.88%. That’s a jump of 50 basis points in less than one month. War has been the forerunner of inflation so many times in history.

What’s interesting is that the price of gold has been dropping lately. When hostilities started, gold was around $5,400 per ounce. Yesterday, gold got down below $4,100 per ounce. Gold often rallies during times of geopolitical stress. This time, the drop in gold makes sense if real interest rates rise. In plain English, lower gold hints that the Fed will have to raise rates well above the level of inflation. That’s not good for the economy.

There’s still a lot of fear in the markets, and the big issue is, not surprisingly, the price for oil. While oil is still well below its peak (near $120) from two weeks ago, it’s still elevated. For what it’s worth, betting markets don’t see traffic in the Strait of Hormuz returning to normal for several weeks.

The market was helped on Monday by an optimistic tweet from President Trump regarding “a resolution of hostilities” in the Middle East. The Iranians, however, said there have been no direct talks. Oil dropped down to $88 per barrel on Monday which is the lowest in two weeks. Before the war, oil was around $65 per barrel.

Oil stocks have been the big winner so far this year. The S&P 500 Energy ETF (XLE) is up about 38% in 2026, and the year isn’t yet one quarter over. I also like to keep my eye on the performance of the S&P 500 Industrial Sector (XLI). This is often an overlooked part of the market, but it’s very important for the overall economy.

Starting in December, industrials performed very well compared with the rest of the market. It was one of their best runs in 20 years, and it lasted through February. Since hostilities started, industrials have started to lag. That could be a sign for the entire economy.

We still don’t know the impact of Operation Epic Fury, outside of oil prices. It’s true that the U.S. economy is far less dependent on oil than it used to be. We’ll soon learn more. Next Friday, April 3, the government will release the March jobs report. This will show us how well the economy has been holding up.

We should also bear in mind that the labor market has been quite weak for the last several months. Less jobs growth means less money to go shopping and that cuts into corporate profits. For February, the U.S. economy shed 93,000 jobs.

Abbott Labs Drops to a Good Price

One of our favorite Buy List stocks, Abbott Labs (ABT), has performed poorly. That puts off a lot of investors, but I always pay attention when the stock of a good company does poorly. That’s where you can often find a good bargain.

On January 22, Abbott reported solid earnings results, but the shares took a bath. Abbott Labs reported fiscal-Q4 earnings of $1.50 per share. That beat expectations by one penny. That was also inside the company’s own guidance for Q4 earnings of $1.47 to $1.53 per share. Abbott’s quarterly earnings were up 12% over last year.

For the full year, Abbott made $5.10 per share, which was up 10% over last year. CEO Robert Ford said, “Abbott is well positioned for accelerating growth in 2026.”

Despite the earnings beat, the stock got dinged due to poor results from its baby-formula business. The company offered mostly optimistic guidance. For 2026, Abbott sees earnings coming in between $5.55 and $5.80 per share. At the midpoint, that’s 10% growth. Wall Street had been expecting $5.68 per share. Abbott sees full-year organic-sales growth of 6.5% to 7.5%. For Q1, Abbott expects earnings between $1.12 and $1.18 per share. Wall Street had been expecting $1.19 per share.

Abbott’s Q4 sales rose by 4.4%. That’s organic growth of 3.0% to 3.8% when excluding Covid-testing sales. For 2025, sales were up 5.7%. That’s organic growth of 5.5%, or 6.7% when not counting Covid sales.

Abbott had Q4 sales of $11.5 billion, which was $300 million below expectations. Nutrition sales were $1.9 billion, which was well below expectations. Abbott said it was forced to raise the price for baby formula when manufacturing costs increased.

Medical devices are Abbott’s largest business. Quarterly sales were $5.67 billion, which matched estimates. The company just completed its acquisition of Exact Sciences for $21 billion. This should help the company expand its footprint.

In December, Abbott increased its dividend by 6.8% to 63 cents per share. This marks the 54th year in a row that Abbott has increased its dividend. Since 2020, the dividend has grown by 70%.

On Tuesday, shares of ABT fell to a new 52-week low. Going by the most recent price, ABT is currently going for about 17 to 18 times this year’s earnings. Bear in mind that Abbott’s estimates tend to be quite conservative. In our premium service, we rate ABT a strong buy up to $115 per share.

That’s all for now. The first quarter comes to a close next week. On Friday, April 3, we’ll get the jobs report for March. I’ll have more for you in the next issue of CWS Market Review.

– Eddy

P.S. You can sign up for our premium service here.

P.P.S. Here’s something for fun I wrote earlier this week about math and March Madness:

Today is the day I’ll take something fun and ruin it with math! Who’s with me?

We’re in the middle of the NCAA basketball tournament. Most brackets are scored linearly, but here’s the big secret: basketball teams generally follow a Power Law distribution.

Simply put, this means that the difference in quality of teams tends to get smaller the lower you go. In practical terms, this means the #1 seed is really, really good. The quality difference between #2 and #3 tends to be smaller than the difference between #1 and #2. This continues through the entire bracket.

How can we see this in action? A good example is the bettor’s favorite, the #12 vs #5 game. Despite the difference of seven places, the teams aren’t that far apart. Historically, #12 wins about 35% of the time. It’s an upset, but a pretty minor one.

Interestingly, that’s close to the record of #3 against #1 (36%). In other words, the implied quality difference between those two spots is about the same difference with the seven spots between #5 and #12. That’s the Power Law in action.

For basketball fans, the Power Law means avoiding the #1 as long as you can, or hoping they get knocked out early. Earlier I mentioned the #12 seed. They’ve made it to the Sweet Sixteen 22 times, and 20 times they’ve faced off against #1. They’ve lost every single time.

The Power Law means the worst seed is #8 or #9. That means you have a very hard time getting to the Sweet 16 because you face #1 in Round 2. #1 has beaten #9 92% of the time.

The best seed is #11. Why? Because you avoid #1 for a long time. Assuming the higher seed wins, #11 plays #6, then #3, then #2, then #1.

Here’s the most remarkable stat. #11 has made to the Final Four more than #16, #15, #14, #13, #12, #10, #9, #8 and #7. #11 is tied with #6 and since they play each other in the first round, this means #6 follows the same course as #11.

The NFL avoids these issues because it “reseeds” its playoffs. Personally, I prefer how March Madness does it.